How to overcome the problems of programmatic advertising

Digital advertising revenue reached $88 billion for 2017, according to the internet advertising revenue report conducted by Pricewaterhouse Coopers and sponsored by the Interactive Advertising Bureau (IAB). This shows programmatic ad buying remains one of the fastest-growing areas of marketing, but it’s an area fraught with problems.

Programmatic Pitfalls and Solutions

Programmatic ad buying works because it allows media buyers to buy “eye-balls,” which means only paying for impressions that are actually seen by a qualified viewer. In addition to user-driven problems like the use of adblocking, advertisers have to deal with the following issues:

#1: Brand Safety

In March last year, AdWeek reported how three of the country’s biggest advertisers pulled almost $5 billion a year in adspend from YouTube, out of concern about their ads appearing alongside extremist content. This fueled an ongoing debate about brand safety, particularly on social media platforms, with 99% of respondents to a survey remaining concerned two years later. Brand safety remains one of the biggest risks facing programmatic advertisers, which can destroy their credibility in their target market with a single direct hit.

How to fix this: The use of brand safety tools is a viable option for media buying houses and large advertisers, but for smaller companies the options are more limited. For the best protection, marketers need to apply control through layers of monitoring and measurement, and set up alerts to warn them of any risky activity by their ads.

Create “black” and “white” lists of platforms and remember to update them frequently, because what constitutes “safe” varies over time. Use private marketplaces where you can choose the location of your ads and control the content they appear with.

Also, pay for premium content instead of risking exposure to user-generated content, and instead of competing for the most clicks, start competing for the right ones.

#2: Multi-Device Measurement

It’s challenging enough for marketers to track user acquisition, engagement, retention and conversion on a single platform. With programmatic advertising, the use of multiple devices and channels makes cross-platform attribution a potential nightmare. It’s no longer about basic website trackers and cookies, but about keeping up with a ton of touchpoints across a huge number of different contexts. Managing this is no picnic, but without effective metrics marketers have no idea whether they’re getting ROA* on their expenditure or not.

How to fix this:

Use a good cross-platform attribution partner who can track your performance across all the channels, platforms and devices encompassed in your strategy. You need to utilize one of two types of attribution models: a rule-based approach or a statistical model. The option you select should offer a complete overview of a campaign’s performance, to help you make data-driven decision.

#3: Advertising Fraud

The rise in programmatic advertising offers incredible targeting opportunities for marketers to reach the right prospects at the right time, using the right channels and devices. Realistically, the practice is wide open to fraud, with

the World Federation of Advertisers predicting that ad fraud will cost advertisers $50B globally by 2025. A 2015 Bot Baseline Report showed display ads sold by publishers with CPM rates higher than $10 were 39% more receptive to bots. Between 3% and 37% of programmatically-purchased ad impressions were found to be from bots, which also accounted for 9% of display ad views and 21% of video ad views. Meanwhile, almost four times as much ad fraud came from sourced (rather than non-sourced) traffic. When ads are purchased that don’t even have the potential to be seen by a human user, it’s the marketer who loses out, and this is a major concern for the industry.

How to fix this:

Improving ad viewability is essential to ensure marketers’ ads are working for them. Current viewability standards are:

Desktop display – min. 50% of pixels in view for at least one second

Desktop video – min. 50% of pixels in view for at least two seconds

Ads larger than 242,500 pixels/970 X 250, 30% of pixels in view for at least one second.

Things you can do to resolve this are:

Demand more transparency and control from vendors and platforms on where your ad is being served and to whom.

Use 3rd party technologies e.g. comScore to identify and weed out bots.

Run your ads during business hours because most bots are nocturnal, with data showing their activity spiked between 11 pm and 5 am.

Finally, remember that bots don’t typically fill out online forms, so if your incoming contacts are leading to sales, it means your ads are working. Keep the ones that are doing well and ditch the others.